The Concentration of Hospital-Based Medical Spending: Evidence from Canada*

Résumé court:

We analyze hospital-based medical spending using longitudinal administrative data from the province of Quebec, Canada. We document how medical spending is concentrated cross-sectionally, over time and near the end of life. Average expenditures rise rapidly with age starting around 50 y.o., and are concentrated among a few high-cost users (e.g. the top 1% of individuals account for 55% of spending). Persistence among high-cost users is low, however: fewer than 3% of those in the top quintile of spending remain in that quintile the following year, and only 5% have any spending the following year. Finally, hospital-based medical spending among those who die at the hospital within a year accounts for 11% of spending for the population as a whole. More than 80% of that end-of-life spending occurs in the last month of life.